In Focus: Are These Salaried Workers Doing Hourly Work?

The latest chapter in the ongoing war between employers who want as many exempt, salaried workers as possible and advocates for more nonexempt employees eligible for overtime comes from an odd request. Urban Outfitters reportedly asked its salaried employees to pick, pack and ship orders for customers during weekends in October. The request seemed jaw-dropping to some. And made them wonder—is it legal?

Already employees must perform the duties of exempt professionals to fit within the white-collar exemptions. But the Department of Labor (DOL) is considering making the duties tests harder to meet, perhaps precisely for the reasons apparent in the Urban Outfitters request—one that seems to attempt to skirt the current looser duties test to get exempt employees to perform nonexempt work.

The risk is that the performance of nonexempt work—packing and shipping—will jeopardize the exempt status of participating employees, even under the more lenient, current duties test. So, what can an employer do to make sure it’s complying? One approach, not without some risk, is to collaborate with the DOL on a solution.

But
in this age of aggressive DOL enforcement of wage and hour laws,
turning yourself in won’t necessarily result in lenient treatment. Oil
and gas company Halliburton discovered this when it was stuck with an
$18 million settlement of overtime grievances.

The proposed overtime rule may make requests like Urban Outfitters’ a relic of the past, as the threshold for exempt workers is being more than doubled to $50,440 per year under the proposal. Employers are scrambling to prepare for the rule’s impact, and hoping that stricter duties tests don’t wind up being imposed because a few employers stretch the limits of exempt work.